|Traditional Burial Business Goes Up in Flames|
|Subject||Sources of monopoly, comparative statics|
|Key Words||Industry, competition, discount, cost, regulations, price, charges|
The traditional funeral industry is facing increased competition. Discount casket stores are springing up, many on the Internet. On average, families pay $2,176 for a casket; discounters estimate they can halve the cost. Cemeteries now offer ceremonies and services customarily provided by funeral homes. Some families are foregoing viewing of the body and chapel services in favor of nontraditional ceremonies. Cremations now account for one-fourth of all funerals. The cost is only approximately $500 plus extras, such as urns and vault drawer markers.
These trends are occurring in the wake of a stable death rate and stricter government regulations on funeral pricing. Since 1984, funeral homes have been required to itemize charges (including the expensive "professional service charges"), rather than give a single price for a funeral. In 1994, the homes were prevented from penalizing families that wanted to buy the casket elsewhere.
Traditional funeral directors want the regulations that apply to them also to apply to other providers of so-called death care services. The regulations would require price lists to be published and goods and services to be guaranteed. Cemeteries believe that their costs would rise.
(Updated November 1, 1999)
|Source||Richard Willing, "Funeral homes fight for life, "USA Today, October 8-10, 1999.|
Return to the Monopoly Index
©1998 South-Western College Publishing. All Rights Reserved webmaster | DISCLAIMER